14:36:02 EST Mon 11 Nov 2019
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Auryn Resources Inc
Symbol AUG
Shares Issued 95,169,900
Close 2019-08-06 C$ 2.01
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Auryn acquires two concessions in Peru

2019-08-07 08:06 ET - News Release

Mr. Ivan Bebek reports


Auryn Resources Inc. has acquired a 100-per-cent interest, subject to certain historical net smelter return royalties, in the Sambalay and Salvador concessions which are adjacent to Auryn's wholly owned Curibaya property in southern Peru for $250,000 (U.S.).

A message from Ivan Bebek, executive chairman and director:

"Curibaya is located within a mineral trend that hosts some of Peru's largest porphyry deposits, including Freeport McMoRan's Cerro Verde deposit, Southern Copper's Cuajone and Toquepala deposits, and Anglo American's Quellaveco deposit.

"We have been interested in these claims since we first acquired the Curibaya property in 2016 due to its highly prospective location and the mineralization identified to date."

The Sambalay and Salvador concessions total 4,700 hectares and together represent a two-kilometre-by-3.3-kilometres mineralized alteration system that shows affinities to both high-grade copper porphyry and precious metal intermediate sulphidation systems. Historical high-grade sampling includes up to 13.50 per cent copper, 23.6 grams per tonne gold and 14,180 g/t silver (see attached table). Despite these results, Auryn is unaware of any historical systematic exploration or drilling on the properties.

The Curibaya project is located 53 km north-northeast of the provincial capital, Tacna, and is accessible by road in 2.5 hours. It is also 11 km south of the Incapuquio regional fault, which is viewed as a major control on the emplacement of mineralized porphyries in the region and is characterized by an Aster alteration anomaly (two km by 3.3 km) that is similar in size to Southern Copper's Toquepala deposit as well as Anglo American's Chisispaya deposit.

Mineralization and historical sampling highlights from Sambalay and Salvador

Mineralization within the Sambalay and Salvador concessions is hosted within the Toquepala volcanic sequence and the Gramadal limestone. Specifically, there are three defined zones of mineralization on the acquired concessions: Aqua del Milagro, Mina Tapial and Sambalay Chico. The Aqua del Milagro and Mina Tapial zones cover an area of two km by one km and 900 metres by 100 metres, respectively. They are both interpreted to represent a potential intermediate sulphidation system due to the presence of high-grade gold and silver samples, strong silica clay alteration and associated silica vein stockworks. Auryn's technical team believes that the observed intermediate sulphidation style of mineralization provides an exploration target analogous to Buenaventura's San Gabriel deposit (1.4 million gold ounces at 5.7 g/t measured and indicated and 800,000 gold ounces at 4.6 g/t inferred).

Samples from the Aqua del Milagro zone contain a high gold-silver content, with values up to 14,180 g/t silver and 23.6 g/t gold. Samples from the Minas Tapial epithermal veins contain both high-grade gold-silver as well as copper, with values up to 15.1 g/t gold, 2,780 g/t silver and 13.5 per cent copper.

The third defined zone of mineralization, Sambalay Chico, is situated along an east-west-trending structural corridor parallel to the Incapuiqo regional fault. The high-grade copper mineralization extends over an 800-metre strike length and is hosted in three parallel breccia bodies that are between 1.5 metres and eight metres in thickness. Samples from the breccia bodies have copper values up 10.85 per cent and strongly demonstrate the potential for copper porphyry mineralization at depth.

The attached table summarizes the highlights from historical grab samples at Aqua del Milagro, Mina Tapial and Sambalay Chico.

A message from Michael Henrichsen, chief operating officer and chief geologist:

"We are very pleased that we were able to consolidate the Curibaya land postion with the acquisition of these concesions. The abundance of high-grade copper, gold and silver in one of Peru's most endowed mineralized belts represents another excellent opportunity for us to make a major discovery in Peru.

"We look forward to rapidly advancing the project to drill stage through systematic surface exploration and an airborne VTEM geophysical survey across the multiple mineralized centres."

Deal terms

Under the mining concessions transfer agreement entered with Wild Acre Metals (Peru) SAC dated Aug. 2, 2019, the company will pay $250,000 (U.S.) for the transfer of the concessions, in favour of the company, upon recording of the transfer agreement with the Peruvian Public Registry. The Sambalay concessions are subject to a 1.5-per-cent net smelter returns royalty in favour of each of Teck Peru SAC and Compania de Exploraciones Orion SA. One-third, or 0.5 per cent, of the Teck NSR royalty, is buyable for $1.0-million (U.S.). The Salvador concessions are subject to a 2-per-cent NSR royalty and a $2.0-million (U.S.) production payment, payable at the time a production decision is made, and to secure payment of such consideration a legal mortgage in favour of Teck is recorded in the registry files of the Salvador concessions.

                              HISTORICAL ROCK SAMPLES

            Agua del Milagro                  Mina Tapial               Sambalay Chico
Au (g/t)   Ag (g/t)    Cu (%)  Au (g/t) Ag (g/t)    Cu (%)  Au (g/t) Ag (g/t)    Cu (%)

23.6        14,180      0.01      15.1     1610      3.83      0.02      1.4     10.85
2.86           293      0.01       6.1        8     0.003      0.02      2.2      8.63
2.36            73      0.03      4.93       17      0.26      0.01     22.8       7.4
1.67           377      0.01      3.64    2,780     10.55      0.08      8.3      6.57
1.64           347     0.004      2.08       28     0.002      0.06      1.1      4.67
1.62         1,060      0.04      0.36      203      0.11      0.01      4.3      2.99
1.6            300      0.01      0.18      126      7.07      0.01      2.5      2.99
1.46           248     0.003      0.15      344      13.5      0.02      3.2      2.68
1.16         2,600      0.01      0.06       33      4.97     0.003      3.7      2.32
0.73           203      0.01      0.04       27      2.02      0.03      2.7      1.87
0.55           620     0.004      0.03       20      2.36      0.01      1.8      1.37
0.4            200      0.05      0.03       41       1.8     0.004      8.2       1.3
0.38         2,070      0.01      0.02        9      1.24
0.23         1,410      0.02
0.13         1,340      0.01
0.12         3,260      0.02
0.09           523      0.01
0.07           618      0.01
0.07           259      0.04
0.05         1,660      0.02

Michael Henrichsen (chief operating officer), PGeo, is the qualified person who assumes responsibility for the technical contents of this press release.

About Auryn Resources Inc.

Auryn Resources is a technically driven, well-financed junior exploration company focused on finding and advancing globally significant gold, silver and base metal deposits. The company has a portfolio approach to asset acquisition and has seven projects, including two flagships: the Committee Bay high-grade gold project in Nunavut and the Sombrero copper-gold project in southern Peru. Auryn's technical and management teams have an impressive record of successfully monetizing assets for all stakeholders and local communities in which it operates. Auryn conducts itself to the highest standards of corporate governance and sustainability.

About Curibaya

Auryn acquired 100-per-cent ownership of the Curibaya property in 2015 and the adjacent Sambalay and Salvador concesssions in 2019, which collectively consist of approximately 11,000 hectares. The Curibaya project covers the regional Incapuquio fault zone and subsidiary structures, which are interpreted as one of the fundamental controls for both epithermal and porphyry styles of mineralization within the region.

Historical grab samples -- Sambalay and Salvador

The historical grab samples on Sambalay and Salvador were collected by Teck (2010 to 2011), Compania de Exploraciones Orion SAC (2010 to 2011) and Wild Acre Metals (2012 to 2013). Auryn has not conducted any due diligence on whether appropriate quality assurance/quality control protocols were followed in the collection of these samples, nor can it confirm their accuracy or repeatability.

We seek Safe Harbor.

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